Rep. Godshall Fighting Montco's 'Construction Tax'

January 28, 1986|The Morning Call

Legislation that would repeal Montgomery County's power to collect its "construction tax" has been introduced by state Rep. Robert W. Godshall, R-53rd District.

House Bill 2005 would repeal the Transportation Partnership Act, a state law designed to help municipalities raise funds for road repair and construction through fees assessed on new housing and commercial developments.

The Republican administration in Montgomery County implemented the tax for 1986. The county expects to raise $2.5 million through the levy.

Godshall charged that the county commissioners have misinterpreted the intent of the law. Godshall said the law doesn't mean county governments have a new taxing authority.

"I feel this legislation will pass the House," said Godshall. "It will force the issue."

Under the construction tax, the county levies a one-time assessment of 12 cents for every one-way vehicle trip a building type generates during the year. The number of trips is determined by the Trip Generation Report published by the Institute of Transportation Engineers in Washington.

A single-family home, according to the report, generates an average of 3,650 trips a year and would therefore be assessed at $438. Under a similar formula, a large office building might be assessed at $46,000.

The administration intends to use the revenue to finance its allocation to the Southeastern Pennsylvania Transportation Authority and as a subsidy to the county's Roads and Bridges Department.

The Republican said trade associations representing construction and real estate interests oppose the tax because they believe it could lead to a slow- down in new home sales in Montgomery County. Godshall said the new tax also could erode the existing tax base in the county because it does not promote development.

Godshall complained that the commissioners enacted the tax to avoid raising the real estate levy.

He suggested other counties may follow Montgomery County's lead.

He said, "I think other counties will institute the same thing, and that will hurt us in attracting business and industry."